Magazine Issues » June 2019

Sponsored feature: Holistic fund data management

The fund industry is building a sophisticated response to increasingly complex data and information needs. By Didier Kayl – Head, Business & Relationship Development, Client Service Management, Fundsquare.

Information and data flows within the investment fund industry just keep growing. Complying with tax, reporting and investor disclosure requirements, meeting modern market and investor expectations, as well as exploiting new technology, all involve more data and information sharing.

Holistic fund data managementAdded to this upsurge of data and data needs is the historical trend of declining fee levels. To meet these challenges, established actors and industry newcomers are advocating, and using, various combinations and types of solutions. However, getting the most out of these, and thus creating value along the entire distribution chain, requires a deeper understanding and a better use of investment fund data and information.

In this context, holistic information management is becoming essential. This is a process that runs in real time between the digital service provider and the digital consumer. It is highly iterative, meaning it has a structured delivery element and an enriched feedback one. It integrates, fully or partly, data lakes and big data analytical methods.

The keys to servicing data consumers
Now more than ever, asset managers and others in the fund data chain have important obligations to deliver the right information to users, other actors along the chain and investors. The MiFID II disclosure requirements are a prime example in this respect.

It is clear that digital sales points will soon become ubiquitous, just as they already are in retail banking. The bottom line, then, is that it is of upmost importance to ensure that all actors along the chain receive high-quality data and information in due time.

The delivery element in any holistic information management approach requires three key components to be in place. The most crucial is data quality. Industry actors must take the stance that this is paramount, not only because it is necessary in itself but also because feedback from the data consumer to the data service provider is built into holistic management. Moreover, quality and integrity of data will help nurture digital points of sales and will enable ongoing innovation based on insights gained.

Secondly, data accessibility needs to be improved. In the fund industry, data and related information are stored in different, often incompatible, formats and in many repositories. Different data consumers have different access needs and it is here that data lakes, which are for storing all types of data and for supporting all types of users, can be extremely useful and in fact are becoming required.

Thirdly, when processes for data quality and accessibility are in place, there is a compliancy component that should be assured. Investors and all other actors in the chain must have the right data at the right time and for the right compliant reason.

Holistic information management is a powerful data-based approach that enables cost reduction, automation and innovation. Nevertheless, initial costs may be a burden if implemented by companies acting alone. Therefore, mutualising holistic management across the entire fund industry and via a solid market infrastructure is the most efficient solution.

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